What Value is a Strategy Without The Capability To Execute?

So, you’ve come up with a grand strategy.  Your leadership is excited, you have communicated it to your people and they’re all revved up, bought in and raring to go.  You’ve won hearts and minds – congratulations! But have you enabled the organization with the capabilities it will require to bring this strategy to life?

Here at Geigsen, we’re fond of saying that you need three things to effectively connect a strategy to the people in an organization who will end up making it happen: head, heart, and hands:

As we can see from this diagram, missing any piece of this can lead to feet dragging, chaotic action, or in this case – frustration.  Frustration in the sense that, without the proper capabilities, people will see the bright and brilliant strategy, care about it, and yet lack the skills and tools to execute.

So how do we create the linkage between our strategy and the capabilities required to execute?

First, let’s define what we mean by “capabilities”.  A capability is the unique combination of people,  processes, and technology to drive a part of a strategy forward.  Let’s unpack that a bit by using an analogy.  Say you are Airbnb, and a part of your growth strategy involves increasing your share of the business travel market.  Because Airbnb’s traditional market is leisure travelers, this involves a change from their existing capabilities.  Therefore, to grow in this area, let’s say the capability required is “B2B sales and marketing”.  So how do we create this capability?

1.       Assess the people needed to build the capability – what are the key skills that are required in order to execute on this part of the strategy? In the case of Airbnb, this might include B2B sales skills.

2.       Identify the critical processes that must be in place to succeed in this area.  For Airbnb this might be the B2B sales process – the way in which a B2B sales rep prospects for, identifies, engages, and closes a deal with a company that it would like to engage as a customer.

3.       Articulate the technology requirements – To have a fully performing capability, it must be enabled by the appropriate information (readily available qualitative or quantitative data) and / or technology (advanced tools).  For our Airbnb example, this might be a Customer Relationship Management (CRM) platform so that the B2B sales reps have the information about each B2B customer easily accessible when interacting with them. 

 With all three of these components in place, we can truly say that we have this capability.  Without any one piece of this puzzle, the result will be sub-optimal, as shown below:

Going from identification to assessment

Once each of these three pieces has been identified, you can ask the next logical question: “what do I have and what do I need?”.  For each category, you can conduct an assessment such as the one depicted below based on this Airbnb example:

From here, you can expand this assessment to any areas of the strategy which you prioritize.  While this example zooms in on one particular capability, it is also critical to look at the strategy as a whole and ask: “what capabilities does my strategy require?”.  With simple tools like this, you can go from a strategic plan that is words on paper, to one that you feel confident can be executed by your organization.  So ask yourself: do you have the capabilities to execute your strategy?